Stock Market: Sensex tanks 542 pts, Nifty at 25,063; IT, FMCG stocks drag indices

Indian equity benchmarks Sensex and Nifty50 fell on Thursday, hurt by selling pressure in IT stocks such as Infosys, Tech Mahindra and TCS.

The BSE Sensex closed the day at 82,184.17, down 542.47 points, or 0.66 per cent. The NSE Nifty50 fell 157.80 points, or 0.63 per cent, to settle at 25,062.10. Rupak De, Senior Technical Analyst at LKP Securities said the Nifty slipped lower, as it faced stiff resistance around the 25,250–25,260 zone. 

“On the hourly chart, the index fell back below the 50-EMA and closed below it. Overall, the index continues its range-bound movement, which may persist in the near term. On the downside, support remains intact at 24,900; a decisive break below this level could trigger a correction in the market. On the other hand, a sustained move above 25,260 may induce a fresh rally," Rupak said.

Among Sensex stocks, Trent dropped 3.95 per cent to Rs 5151.70, leading the Sensex losers. Tech Mahindra followed with a 3.15 per cent fall. Other losers included Bajaj Finserv (down 1.59 per cent), Reliance Industries (down 1.53 per cent), Infosys (down 1.31 per cent), and Kotak Mahindra Bank (down 1.3 per cent).

Reliance, HDFC Bank, Infosys, Trent, and ITC were the top contributors to the Sensex's decline. Among sectoral indices, the BSE IT index fell 1.84 per cent, or 669.38 points, to end at 35,688.95. The BSE FMCG declined 1.08 per cent, or 223.30 points, to close at 20,362.89. 

Shares of Indian Energy Exchanges (IEX) fell 28 per cent during Thursday's trading session, following the Central Electricity Regulatory Commission's (CERC) decision to approve a phased rollout of market coupling across India's power exchanges.

After Nestle India, a packaged foods company, reported a 13.4 per cent decline in consolidated net profit for the quarter ending June 30, its shares fell by almost 6 per cent. From Rs 746.6 crore in the same quarter of the previous year, the company's net profit dropped to Rs 646.6 crore.

Vinod Nair, Head of Research, Geojit Investments Limited, said, “Indian equities fell sharply today, reversing previous gains despite positive global cues. Initial optimism around the India-UK free trade agreement gave way to caution as attention shifted firmly to earnings.”

“The IT and FMCG sectors dragged down large-cap stocks due to subdued Q1 performance. Though the Q1 earnings are broadly in line, it does not justify the premium valuation; India is trading at a 3-year high of 21x P/E," Nair said.

Out of 4,221 stocks traded on BSE today, 1,648 advanced, 2,410 declined while 163 remained unchanged.